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Revised Small Macro-Econometric Model Of The Nigerian Economy

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  • Olofin, S.O.
  • Salisu, A.A
  • Tule, M.K

Abstract

The first operational small-scale macro-econometric model of the Nigerian Economy was developed in 2013. Ever since, the country has witnessed significant changes owing to oil price shock which culminated in internal and external imbalances. Addressing these challenges among others, informed the revision of the model. Thus, in the revised model, provisions are made for unemployment and the role of expectations and uncertainty surrounding the oil and foreign exchange markets. By simulating three alternative policy scenarios using oil price, monetary policy rate and cash reserve ratio, some striking results are obtained with implications for monetary policy in Nigeria. Alternative method was applied in the disequilibrium model of demand and supply of primary and intermediate inputs by Guisan (2011, 2013), this further supports the potential of monetary policy in addressing macroeconomic variables through interest rate channel.

Suggested Citation

  • Olofin, S.O. & Salisu, A.A & Tule, M.K, 2020. "Revised Small Macro-Econometric Model Of The Nigerian Economy," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 20(1), pages 97-116.
    • Handle: RePEc:eaa:aeinde:v:20:y:2020:i:1_7
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    More about this item

    Keywords

    Macro-econometric models; Policy simulation; Nigerian economy.;
    All these keywords.

    JEL classification:

    • C50 - Mathematical and Quantitative Methods - - Econometric Modeling - - - General
    • E27 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Forecasting and Simulation: Models and Applications
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies

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